Business in brief: Manufacturing sector picks up speed

Manufacturing growth accelerated in January for a fifth consecutive month on stronger orders and production that signal America's factories are rebounding.

The Institute for Supply Management's index rose to 56, the highest since November 2014, from 54.5 the prior month. The median forecast in a Bloomberg survey of economists called for 55. A reading above 50 signals expansion.

The report showed the gauges of production and orders also climbed to more than two-year highs, underscoring sustained improvement in manufacturing following a soft patch in mid-2016. Stronger demand is helping drive up costs of raw materials, as a measure of prices paid jumped to the highest since May 2011, adding to signs of inflation picking up worldwide.

"It's a continuation of the momentum" built up in the latter part of 2016, Bradley Holcomb, chair of the ISM survey committee, said on a conference call with reporters. Businesses are optimistic about fewer regulations and a favorable environment under President Donald Trump, and "we're kick-starting the new year with those things in mind."

Specter of trade war looms

World leaders aren't taking Donald Trump's trade barbs lying down.

After the U.S. president said Germany and Japan are gaming foreign-exchange markets to win favorable trade terms, Japanese Prime Minister Shinzo Abe joined German Chancellor Angela Merkel in pushing back and leading a global counter-charge to the accusations.

"A massive clash is starting to emerge with Trump willing to get into major geopolitical spats with China and other countries to advance his 'America First' agenda," said Mark Leonard, director of the European Council on Foreign Relations.